“The survey clearly shows that firms are struggling with the legacy of
their separate, siloed risk systems,” said Geoff Kates, CEO of Lepus.
“That makes it extremely difficult to combine high-quality data for
regulatory reporting, risk and capital management, and stress testing.”

An overwhelming majority of firms seemed skeptical of their ability to
prove data origin – a requirement of BCBS 239. Some 67 percent saw room
for improvement and 22 percent identified a need for significant
investment.

The institutions were also asked if they expected BCBS 239 compliance
initiatives to deliver ancillary business benefit. Many anticipated
achieving a more holistic organizational view of risks, with 22 percent
citing improved stress testing capabilities and 30 percent needing a
more holistic view of firm-wide risks.

“In the regulatory-compliance future, stress testing will be an ongoing
process of analyzing unpredictable scenarios instead of an annual
exercise devoid of surprise,” said David M. Wallace, SAS Global
Financial Services Marketing Manager. “Banks that fully implement BCBS
239 principles as best practices will be able to analyze surprise
scenarios on demand for regulators. In addition, they’ll be more
effective and efficient in capital planning.”

SAS provides a range
of solutions to help firms meet the BCBS 239 principles from risk
data quality and management, data lineage, risk aggregation,
visualization and reporting, and stress testing.

Lepus was founded in 1997 to provide research, consulting and marketing
services to the finance industry. Concentrating mainly on investment
banking, Lepus also offers services in the retail, insurance, asset
management, corporate and hedge fund sectors. Lepus’ success is founded
on its ability to provide its clients with a service which is expressly
geared to their individual requirements.